The former Volkswagen plant is back at work under new owners and plans to assemble 27,000 cars this year, the Deputy Governor of the Kaluga Region Vladimir Popov said at a government meeting on August 12, Vedomosti reports.

Russia’s automotive sector has made a full recovery from the stoppage caused by the exit of the international players. Russia produced a total of 138,951 cars this July, just over 6,000 more cars than in July 2021, the last July of normal production pre-war when a total of 132,640 cars were manufactured.

The plant was one of half a dozen that have changed hands following the start of the war in Ukraine, which brought the automotive sector to a screeching halt. Most of the international European Original Equipment Manufacturers (OEMs) have pulled out of Russia and sold their companies to local rivals and entrepreneurs in a series of deals overseen by the Kremlin, concerned not to lose the regional jobs the plants create.

Volkswagen has sold its plant to Russian firm Art-Finance (AGR), which also owns the Avilon car dealership. Russia’s automotive sector was the hardest hit of all industries by the start of the war, but production has bounced back since as the plants slowly start coming back on line under new owners. As of March, Russia's automotive sector has almost made a complete recovery and is on course to sell 1.3mn cars this year, although sales remain about 10,000 units a month below the pre-war peaks. (chart)

According to the Association of European Businesses Automobile Manufacturers' Committee, total sales of new passenger cars and light commercial vehicles in the first half of 2024 amounted to 703,765 units excluding alternative supply channels and about 754,627 units including them. 

“AGR began serial assembly of cars in August and plans to assemble 27,000 cars by the end of the year,” Popov said.

The deputy governor did not specify the brands of cars that are planned to be assembled at the plant. Pre-war the plant produced VW Polo and other Volkswagen and Audi models.

Popov added that the new owner of the former Volvo Trucks plant in Kaluga, the Automobile Motor Society, assembled 649 trucks this year. By the end of 2024, the company plans to increase production to 2,000 vehicles.

In July, Russian Minister of Industry and Trade Anton Alikhanov announced that serial production of automobiles had been resumed at the former Volkswagen plant in Kaluga.

Volkswagen decided to suspend production at its plants in Russia after the start of a special military operation in Ukraine in February 2022. In April 2023, Vedomosti wrote that the government commission for control over the implementation of foreign investments approved the sale of the Volkswagen plant near Kaluga. In May of the same year, Volkswagen announced the sale of its stake in the Russian subsidiary Volkswagen Group Rus to Art-Finance. The dealer acquired all shares in the group and in all Russian subsidiaries of the German concern - including Volkswagen KS LLC, Scania Leasing LLC, Scania Finance LLC and Scania Insurance LLC.

In June 2023, the former Russian subsidiary of the Volkswagen automobile concern changed its name to AGR Automotive Group.